The Supreme Court of India has shut down appeals for a temporary stay on a ruling that would force financial institutions to cease all cryptocurrency related operations, declared in April.
The move sees any entity regulated by the Reserve Bank of India (RBI) be prohibited from engaging in all services related to cryptocurrencies – such as the buying and selling of virtual currencies. Facilitating transfers of virtual coins is also to be included in the restrictions, as reported by Times of India.
The news confirms the fate of cryptocurrency businesses across the country for the foreseeable future: that by July 5, all financial institutions in the country will withdraw from their operations.
Local cryptocurrency exchanges and other businesses will now inevitably be forced into a bureaucratic limbo, awaiting a concrete regulatory framework to be decided upon and ratified.
It’s not for lack of trying, either. Within hours of the original April 6 circular being released, petitions circulated that amassed hundreds of thousands of signatures. The appeal itself was formally lodged by the Internet and Mobile Association of India, a continued vanguard for the cryptocurrency effort in the country.
The meeting was even originally scheduled for later this month, but had been moved forward in an effort to keep businesses operating after this week. With the stay motion rejected, July 5 becomes the last day of financially compliant operations.
Sandeep Goenka, co-founder of leading cryptocurrency exchange Zebpay, confirmed in a tweet that an additional meeting will go ahead at the original date of July 20. Hopes are that at least some considerations can be made to allow for innovation within the Indian blockchain sector.
There may just be a chance, too. In February, Prime Minister Modi heralded the possibilities of the blockchain in a speech-via-video at the World Congress on Information Technology (WCIT), declaring that “disruptive technologies such as blockchain and the Internet of Things (IoT) will have a deep impact in the way we live and work.”
It’s not only exchanges at stake either; the ruling will also affect a significant number of companies whose primary business deals with blockchain and cryptocurrency.
It will be interesting to see what course of action affected companies will resort to. In the case of recent regulatory crackdowns in Japan, Hong Kong, and China, a slew of fledgling blockchain businesses opted to seek shelter overseas.